Sarkozy pursues pension reform as L'Oreal scandal lingers

French government adopted an unpopular bill to raise the retirement age after President Sarkozy failed to silence his critics over illegal donation allegations.

Sarkozy pursues pension reform as L'Oreal scandal lingers

 

The French government adopted an unpopular bill on Tuesday to raise the retirement age after a defiant President Nicolas Sarkozy failed to silence his critics over alleged illegal political donations.

Labour Minister Eric Woerth, at the centre of the affair, said he would step down as treasurer of the ruling centre-right UMP party later on Tuesday but remains in charge of the bill to overhaul pensions, which he presented to the cabinet.

Sarkozy stressed in a television interview on Monday he was determined to see through the plan to raise the retirement age to 62 from 60 and to make people work longer for a full pension despite expected protests in September.

The reform was essential to bring down the public deficit and national debt, and prevent France entering a debt spiral similar to that of Greece and Portugal, he said.

Trade unions promised to fight the bill and said they would seek to force the government to retreat.

"The risk of social unrest after the summer holidays has not been dissipated," Dominique Barbet, an analyst for BNP Paribas, said in a research note.

A former bookkeeper for L'Oreal heiress Liliane Bettencourt has told police that the billionaire and her late husband made illegal cash donations to conservative politicians for years, including to Sarkozy's 2007 election campaign.

Sarkozy said Woerth had been exonerated of any wrongdoing by an official finance ministry report, had his full confidence and would remain in charge of the pensions reform. However, he said he had advised the minister to step down as party treasurer.

Conflict of interest 

Opposition politicians and media commentators said the president had not answered, or even been asked, all the tough questions about conflicts of interest in Woerth's dual role of party fundraiser and budget minister in charge of tax until until March.

In addition, Woerth's wife worked for Bettencourt's wealth manager until she resigned last month after allegations of tax evasion by the billionaire became public.

In his television appearance, Sarkozy ruled out a cabinet reshuffle before the pensions bill is adopted by parliament, and sought to regain control of the political agenda by focusing attention on the retirement reform and necessary budget cuts.

Suggesting that the Bettencourt scandal had been an unnecessary distraction, he said: "France has lost too much time with this affair."

Pollster Brice Teinturier of the SOFRES institute said the president would not have convinced many undecided voters with his 75-minute television interview, but he had united his own conservative followers by underlining the left-right divide.

Opposition Socialist politician Francois Hollande said Sarkozy had implicitly admitted there was a conflict of interest by advising Woerth to give up his role as treasurer.

"If he asks Eric Woerth to no longer serve as treasurer of the UMP, it's because having been UMP treasurer and budget minister clearly poses a problem and in particular a suspicion of conflict of interest," Hollande told RTL radio.

The left-wing daily Liberation accused Sarkozy of wheeling out conspiracy theories by saying Woerth was the victim of "calumny and lies" by those who want to stop the pension reform.
 

Reuters

Güncelleme Tarihi: 13 Temmuz 2010, 17:08
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